Not your grandfather’s way of settling up!
Coming up with the money to pay the IRS may never get easier, but after many years of paying taxes to the IRS by mail (and receiving refunds from the IRS in the form of Treasury checks in brown envelopes), the IRS enabled the deposit of refunds directly into your bank account several years ago. While some people prefer their refunds by paper check (for reasons tax accountants rarely understand), most people are now receiving their refund, if they have one coming, by direct deposit.
Well, the IRS has now figured out the other side of the coin, so to speak: how to pay the IRS. It has announced the start of its new web-based system, IRS Direct Pay which allows taxpayers to pay their tax bills or make estimated tax payments directly from checking or savings accounts without any fees or pre-registration.
New IRS Commissioner John Koskinen says: “IRS Direct Pay simplifies the payment process, and taxpayers can make a payment from the convenience of a home computer.”
The program is new, but IRS says more than 150,000 taxpayers have paid more than $340 million in taxes through the new system. With IRS Direct Pay, taxpayers receive instant confirmation that the payment has been submitted, and the system is available “24/7.” The Service assures that bank account information is not retained in IRS systems after payments are made.
IRS Direct Pay offers 30-day advance payment scheduling, payment rescheduling or cancellations, and a payment status search. The IRS plans for the future include an option for e-mailed payment confirmation, a Spanish version and one-time registration with a log-in and password to allow quick access on return visits.
We feel this is a good thing. In the “old days” of not so long ago, a check mailed to IRS or anyone else some distance away could take a fair amount of time to make its way through the check clearing process and back to your bank to be deducted from your account. This was sometimes called the “float.” And, you got the actual check back in your bank statement – whoever thought it would change? But it has, and the check now takes a very short time to be charged to your account.
This new plan of the IRS won’t decrease the time it takes the money to clear your account by any significant time. You’ll have a record of it from IRS and in your bank statement. Less time is consumed in recordkeeping, and life will be easier. Well, let’s not get carried away – but it should be a good, helpful step. Here at our office, we’ll be bringing this to your attention as the possibility arises for you to participate in this program.